“If I sell my mutual funds, I’ll get the cash right away.”
Those who open the screen thinking this are the ones who end up pale later on. Selling orders take only a few minutes. However, the money arrives in your account several days later, and that number of days varies by fund. For those with fixed housing settlement dates or moving payment deadlines, miscalculating these few days is the most painful mistake.
This note summarizes how to “read the number of days” from the date of the redemption order to the deposit date, and the “procedure for calculating backwards,” based on my own experience of repeatedly handling redemption procedures for deadline-sensitive cases.
1. Description of the situation readers are currently facing
You have signed a real estate sales contract. You have paid the deposit. The settlement date for the remaining balance is in three weeks.
You planned to cover part of the down payment by redeeming your mutual funds.
You open your brokerage app. The valuation is sufficient. There is a sell button.
But nowhere on the screen does it clearly state “when the money will be deposited.”
“Does selling take 2-3 days to deposit, like stocks?”
“I also have overseas funds mixed in, do they arrive on the same day?”
When you search, you see “4-5 business days” or “varies by fund.” That “varies” is tricky, and you don’t know how many days your specific fund takes. It’s also unclear how to count when weekends are involved. I’ve also seen mentions that if you place an order after the cutoff time, it gets delayed by one day.
The real estate company tells you, “If the funds don’t arrive by the settlement date, we’ll have to talk about contract cancellation or damages.” You also have to settle with the moving company and pay rent that same week. Before you panic and sell everything at once, you need a way to confirm “which fund, when, and how much will be deposited.”
I will write about that confirmation process and the steps to determine the order date by calculating backwards from the deadline.
2. Who this note is not for
Let’s get this out of the way first.
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People who do not have a deadline and want to consult on exit strategies for long-term investment itself. This note focuses on the practicalities of “when the money arrives.”
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People who want to know which funds to buy or want market forecasts. I do not cover price movement predictions.
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People who want to design tax savings to minimize taxes upon redemption. I will write about “how taxes are deducted and how to check them,” but tax planning advice is the domain of tax accountants.
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People who are unsure whether they should sell at all, assuming they want to continue taking advantage of the tax-free benefits of the Tsumitate investment quota. This is a note on “the number of days and procedures after you have decided to sell,” not on the decision to sell or not.
Conversely, for those who already have a settlement or payment date fixed and want “backwards calculation to meet the deadline” and “operations to avoid mistakes on the order screen,” you can use this as is.
3. List of what is included in the paid section
The paid section (Chapter 5 and onwards) includes the following:
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Estimates of the number of days from order to deposit by situation (domestic equity type / overseas equity type / simultaneous redemption of multiple funds) and how to identify the causes of discrepancies.
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Which “line” in the prospectus (fund explanatory document) to look at to confirm the exact deposit date for your fund, including actual citations of those sections.
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Calculation methods for determining the ‘final order deadline’ by counting backward from a target date, and how to count business days (including how weekends, holidays, and overseas holidays affect the timeline)
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12-step order procedure (one action per step). From checking the cutoff time to choosing between specifying an amount versus a number of units, and what items to record on the order completion screen
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The mechanism behind the ‘the amount is different from what I expected’ phenomenon that occurs when redeeming by specifying an amount, and how to place orders without leaving fractional amounts
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How to identify funds with a trust asset retention fee (a cost deducted from the base price at the time of redemption) and how to estimate the amount that will be deducted
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How the withholding tax in a specific account reduces the deposit amount and how to calculate an estimate in advance. Differences from NISA accounts
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How to handle situations where you encounter an ‘order unavailable day’ for overseas funds (days when orders cannot be accepted due to overseas market closures)
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7 common stumbling blocks and how to handle them on the spot (e.g., missed the deadline, price dropped on the trade date, deposit seems delayed)
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3 ready-to-use templates (reverse-calculation calendar sheet, inquiry email example for securities companies, and cash flow checklist for settlement dates)
4. An overview of the entire process in 3 steps
There are three main parts.
Step 1: Know the ‘day-count pattern’ of your fund
The redemption process consists of three points: ‘Order Date → Trade Date (the day the transaction is executed and the price is determined) → Settlement Date (the day the money enters your account).’ For each fund, it is determined how many days after the order the trade date is, and how many business days after the trade date the settlement occurs; this can be confirmed in the prospectus and on the order screen. First, get a handle on this.
Step 2: Calculate backward from the deadline to determine the final order deadline
Count back business days from the settlement date to draw a line saying, ‘If I order by this day, I will make it in time.’ In practice, it is best to allow for a buffer of at least 2 business days.
Step 3: Place the order and confirm the trade and deposit twice
Don’t stop at completing the order. Check the price and number of units on the evening of the trade date, and confirm the deposit on the settlement date. These two checks allow for early detection of any discrepancies.